UGRO Capital has announced the acquisition of a 100 per cent stake in Profectus Capital Pvt Ltd for an all-cash consideration of Rs 1,398.6 crore.
The acquisition aims to significantly expand UGRO’s scale in micro, small and medium enterprises (MSME) lending, introduce new verticals such as school finance, and improve profitability and the mix of secured assets. The deal will be funded through the proceeds from a preferential issue of compulsory convertible debentures and is subject to regulatory and shareholder approvals.
Profectus Capital, backed by private equity firm Actis, reported assets under management (AUM) of Rs 3,468 crore as of March 2025. The company operates across seven states with a network of 28 branches and over 800 employees.
This acquisition is expected to bring immediate scale to UGRO, which had an AUM of Rs 12,003 crore at the end of FY2025 and operates across Tier-I to Tier-IV cities.
Shachindra Nath, Founder and Managing Director, UGRO Capital, stated, “This strategically priced acquisition deploys the equity fundraise to achieve instant scale. It will give cost savings of Rs 115 crore and annualised incremental profitability of Rs 150 crore, thus boosting return on assets by 0.6–0.7 per cent. Also, integrating Profectus’ expertise in financing of schools unlocks Rs 2,000 crore growth potential and strengthens the secured asset mix—accelerating UGRO’s journey to become India’s largest MSME lender.”
As part of the acquisition process, UGRO Capital appointed InCred Capital as the exclusive advisor, SNG & Partners as legal counsel, PriceWaterhouseCoopers Services LLP for financial due diligence, and Legacy Growth Partners for tax due diligence.
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